Japan’s three largest banks to launch yen stablecoin

MUFG, SMBC and Mizuho to launch joint yen stablecoin on Progmat platform to cut costs and modernize corporate settlements.

MUFG, SMBC and Mizuho — Japan’s three largest banks — are planning to jointly launch a stablecoin pegged to the yen.

The project aims to modernize corporate settlements and reduce transaction costs, Nikkei reported.

A single token for businesses

The stablecoin will be launched on the Progmat platform, developed by Mitsubishi UFJ Financial Group (MUFG). The banks want to unify the token standard to make it compatible for internal and inter-corporate payments.

The consortium, which serves more than 300,000 corporate clients, plans to launch the stablecoin by the end of the year. Mitsubishi Corp. will be the first to use it for internal settlements between more than 240 subsidiaries around the world.

Progmat Platform and Expanding Partnerships

The Progmat Coin platform was officially launched in June.

It allows banks to issue yen-backed stablecoins on the Ethereum, Polygon, Avalanche, and Cosmos blockchains.

In September, Binance Japan and Mitsubishi UFJ Trust and Banking also agreed to explore issuing stablecoins on Progmat.

Binance Japan representative Takeshi Chino called stablecoins “a key element of the Web3 financial ecosystem.”

Regulatory context

The Financial Services Agency of Japan (FSA) is preparing to officially approve the issuance of yen-pegged stablecoins, which could be an important step for institutional adoption of digital assets. Fintech company JPYC and the Monex Group are also developing their own yen stablecoin projects.

Financial System Implications

If the initiative by MUFG, SMBC, and Mizuho is successful, it will be the first stablecoin banking network in Japan built on a single technology standard.

The project could pave the way for the full tokenization of Japan’s financial infrastructure, where corporate payments, dividends, and transfers would become instant, cheap, and interoperable across banks.